Biotech theft allegation is denied

Accused by Abbott, EntreMed vows vigorous defense

Biotechnology

Rockville-based EntreMed Inc., a company testing tumor-killing proteins, vowed yesterday to defend vigorously its right to market drugs based on a discovery it is licensed to use.

Illinois-based Abbott Laboratories is charging that EntreMed and associated researchers stole the discovery from Abbott.

EntreMed emphasized that it isn't currently engaged in human tests of any drugs based on the molecule fragment in dispute. The disagreement, the company said, largely is between Abbott on one side and, on the other, defendants Children's Hospital in Boston and its renowned principal researcher, Dr. Judah Folkman.

"This is an issue of inventorship between Children's and Abbott," said EntreMed spokeswoman Mary Sun-deen, who noted that such patent disputes have become common in the field of biotechnology. "We're talking about things that may revolutionize cancer [treatment] and everyone wants a piece of it."

The dispute, which Abbott and Children's Hospital had attempted to settle quietly, became public after Abbott sued the hospital, Folkman, other hospital researchers and EntreMed on Tuesday in U.S. District Court in Boston.

The suit centers on the plasminogen molecule - a clotting factor. The molecule has five folded regions, known as kringles. Abbott and the suit's defendants appear to agree that Folkman was involved in the discovery and patenting of uses of kringles 1-4.

Children's Hospital licensed those discoveries to EntreMed, which used kringles 1-3 to manufacture the anti-tumor protein Angiostatin now being tested on cancer patients at Thomas Jefferson University Hospital in Philadelphia.

Angiostatin is one of two such proteins EntreMed is testing in humans to stunt the growth of blood vessels that feed diseased tissues. Such blood-vessel growth is called angiogenesis, and EntreMed has tied its fortunes to the proteins' effectiveness and dubbed itself "the angiogenesis company."

Its anti-angiogenesis protein Endostatin also is in early-stage testing on cancer patients to determine whether it is safe to use.

Abbott claims in its lawsuit that its researcher, Donald Davidson, discovered novel uses of a kringle 5 fragment that could contribute to shutting down unwanted blood-vessel growth. Davidson, Abbott said, shared the information with Children's and Folkman under a confidentiality agreement so that researchers there could confirm his discovery. Ultimately, Abbott claims, Children's patented the use of kringle 5 instead and licensed it to EntreMed.

According to the lawsuit, Folkman called Davidson's supervisor at Abbott and congratulated the company on its discovery of the usefulness of kringle 5. "Folkman also stated ... that Abbott should file patents on the invention," the suit said.

Yesterday, Abbott spokeswoman Ann Fahey-Widman said the company is "very confident in our position. We intend to vigorously pursue this case."

Children's, however, said in a statement that it is just as convinced. "Abbott does not want to pay royalties," the hospital said. "We find it unconscionable that Abbott would seek to damage the reputation of Children's Hospital and its scientists by making inflammatory and irresponsible charges, all of which we vigorously deny."

While the number of such cases is elusive, several top patent attorneys said yesterday that anecdotal evidence suggests that they are increasingly common. The number of suits involving gene-and protein-related drugs are increasing, they said, as companies turn from chemical compounds to the human body itself to find substances that fight disease.

Pharmaceutical companies can spend $250 million to $500 million to put a successful drug on the market, a process of discovery and testing that can take a decade or more. The majority of drug candidates fail to gain approval, falling down during the rigorous testing of their safety and efficacy on animals and people.

But because a single successful drug potentially could generate billions of dollars in revenue, pharmaceutical and biopharmaceutical companies are motivated to protect their discoveries - and their licenses to profit from the discoveries of others.

"If you look at the valuations of companies, for a lot of biotech companies, their valuations are driven by intellectual property," said Rochelle Seide, a lawyer and chair of the biotechnology committee for the American Intellectual Property Law Association in Arlington, Va.

The organization represents about 10,000 members engaged in the practice of patent, trademark and unfair-competition law.

Shares of EntreMed closed yesterday at $21.75, down $2.9844, or 12.1 percent, on the Nasdaq stock market.